2. Industry analysts told The New York Times that as many as 5,000 WaMu employees will lose their jobs.

3. WaMu chief exec Alan H. Fishman, who’s held the job for less than three weeks, is keeping his $7.5 million signing bonus and may get another $11.6 million in cash severance payments.

4. Texas Pacific’s David Bonderman — who, Oregonians might remember, once tried to buy Portland General Electric using the influence of Neil Goldschmidt and Peggy Fowler — was one of the biggest losers among WaMu shareholders. As The Oregonian’s Ryan Frank said, “Somewhere, Erik Sten is dancing a jig.”

5. Fishman, who was on a transcontinental flight when JP Morgan Chase purchased WaMu from federal regulators for $1.9 billion, may yet walk away with $19.1 million for his three-week babysitting gig. Or did I mention that already?

I should admit, right here, that Washington Mutual is my bank. I mean, it’s where I keep my dough. I must say, though, I’m happy that it went belly-up and happy to do a dance on its early grave. Washington Mutual was a key player in rebranding second mortgages as “home equity loans” to keep you indebted to them in perpetuity, and the more I visited the bank and saw those hard sells, the more disgusted I always became. On the downside: now, Washington Mutual’s genetically perfect, vat-raised tellers will now roam the streets in search of inadequately chirpy customers to condescend to.

(I discussed this second-mortgage rebranding thing with my mom, who argued that, even if the bank made the pitch, it’s still the customer’s responsibility for signing on to a bad deal. That’s true, but a con man is never absolved by a gullible mark.)

September 29, 2008

Op-Ed Contributor – Buy the Loans – Op-Ed – NYTimes.com
HERE’S a key reason Treasury Secretary Henry Paulson’s bailout proposal stalled: it had an overbroad definition of the troubled assets the government would purchase. Under the Treasury’s definition, the government could spend much or all of the proposed $700 billion to buy complex derivatives held by Wall Street firms, instead of directly purchasing actual mortgage loans.

Fortunately, there is a compromise. The most efficient means of providing support to the credit markets would be for Congress to limit the definition of troubled assets to actual home mortgage loans. Congress should give the Treasury authority to purchase only the real financial assets at risk — the actual loans — not the derivatives whose prices depend on the values of those loans. If the government takes this approach, and buys and renegotiates mortgage loans directly, it will indirectly support the mortgage-based derivatives that have caused widespread losses at banks. But it will do so without favoring banks at the expense of homeowners.

Here’s a bailout plan I’d support: given that the financial problems right now can be traced to bad loans that have been securitized and placed around the financial market as ticking time bombs (that all go off at once), have the government buy those loans, not the absurd investment vehicles (grade-A securities, we assure you!) that got us into this mess.

From the financial reporting I’ve read, my impression was that these bad loans, made to people who couldn’t afford them (by banks not realizing that everyone loses in the inevitable default), were sliced and diced and combined with other financial flotsam into “securities” with fancy names like “collateralized debt obligation.” (They would then be sold as no-risk investment vehicles, which is why the subprime mortgage crisis spreads far beyond subprime mortgages; pieces of the bad loans have been scattered far and wide in the financial landscape.) I presumed that meant the only way for the loans to be renegotiated, on the massive scale required to right this mess, would be for the government to buy up all these vehicles and piece the loans back together one by one.

The author, here, sets me straight: it’s not that the loan itself was sliced up, it’s that banks met bets on these lousy loans and placed those bets into the securities. That is, these financial vehicles, sold as though they were pure free money, had value partly depending on whether or not the subprime loans were paid back. Since these loans are collapsing left and right, these securities are also shriveling up; and since these financial vehicles that nobody understands have partly taken the place of money, it’s like a whole lot of money suddenly exploded all at once. To make matters worse, nobody wants to lend in an environment like this; if I’ve just been burned by many, many bad loans, I’m not going to be in the mood to lend any more. That means that businesses simply in routine trouble are now in free fall, unable to borrow the kind of money that could be a lifeline; and businesses that could be expanding aren’t, unable to take that bold next step by borrowing for an expansion. That means few jobs and fewer stable ones. Meanwhile, retirement plans indexed to the market are slipping along with everything else.

That’s part of what’s frustrating about this issue: it’s Wall Street’s mess and Wall Street’s problem, but it affects all of us. You need a solution that doesn’t reward irresponsible bankers for making bad bets and then passing them on as airtight securities. I like this idea: don’t buy the bets, buy the loans.

Oh, and next time, bankers: don’t make loans to people who can’t pay them back! I mean, what the banks did—lend to people who couldn’t pay back, then advertise the bad loans to fellow banks as sure-fire bets—was even worse, but I want to address the problem, since I don’t think it gets enough play. These banks were often skirting their own rules for whom to lend money to at what rate. There’s a strong ethic associated with lending to poor people, since poor people can pretty much always pay back, given that their very livelihood depends on good credit. Since banks have greater leverage than the down-and-out, it’s ethically imperative that they respect the situations of poor people and give terms that will encourage and allow them to pay back the full amount, with modest interest, at a reasonable and responsible pace. This all seems like Banking 101, but some people still haven’t learned. Banks lose too in a default, of course, so their bad practices are coming back to haunt them early.

Oh, and all loans ought to be in terms that non-economists can understand, but that should be a given. And, when loans are sold, chains of custody need to be made clear so that loans can be renegotiated in the case of unforeseen trouble. This is all reasonable and all good business for all parties involved, but it seems that the nation’s money men require a schoolin’ from a college girl with a first-year economics education.

September 27, 2008

I wrote, before, on a friend that I got into a fight with. It didn’t end well, and I’m heartbroken. I really loved her.

I won’t go into it, since I still would genuinely like to be her friend again, but… I want to say that, during the movie, I a) cried buckets (impressive for a comedy movie… this is one of extremely few movies, or productions of fiction at all, about which I can legitimately say that I laughed and cried) and b) realized what was really gnawing at me, why I’ve had such a hard time letting go. (Letting go is a major theme of the movie.)

She cared about me… she knew everything about me, every little quirk, everything that was weird about me, and she still loved me. People say they care about me, but she really cared about me. I didn’t step on eggshells with her. It was wonderful.

The movie really grinds home every single regret you’ll ever have about anyone you may never talk to again. (If you’re reading this, dear: I don’t want that to be us!) That was really tough on me, given that all the things I never got to say, good and bad, happy and angry, have been playing through my head on endless loop for over a month now, no matter how much I assure myself that it’s not healthy and I should ignore it (I do ignore it, but that doesn’t make it go away).

I had a good, long cry. My brother made a “cut it out” gesture for stage-crying in the middle of a movie theater, and I choked out, “shut up.” (I don’t think he heard me.) I needed that cry. I had been holding it in for weeks! In fact… perhaps it’s more like years. I’ve had friends, but never a bestest friend that I could share everything in the world with. When I see that portrayed, even on TV or a movie, I can’t tell you quite how it burns me up with jealousy. I suppose that should teach me a lesson: if so many people take for granted what I imagine would be earth-shatteringly wonderful, there must be such things that I have that I should not take for granted. It’s hard to hold all that in your head. I sort of draw a deep breath and hope I’ll understand when I’m older.

Incidentally, one of my favorite books, and movies, is I Capture the Castle. It’s great. Maybe you’ll learn something about me, huh? I’m an idealist, I guess.

Republican Sen. Gordon Smith blasted his opponent, Democratic House Speaker Jeff Merkley, for “prejudging” the $700 billion rescue proposal before details have been worked out.

Smith was referring to an ad Merkley is running that attacks Smith for supporting a “trillion dollar blank check for Wall Street” and to statements Merkley has made opposing the bailout.

“Part of being a U.S. Senator is reading and understanding bills of this magnitude,” Smith said in a conference call with reporters. “He’s not showing leadership. He is showing partisan opportunism. This is a profile in cowardice.”

On the contrary, Merkley campaign spokesman Matt Canter said, Merkley is the one who has demonstrated his statesmanship on the issue.

“Jeff Merkley has shown real leadership by showing exactly where he stands on the Bush proposal,” Canter said. “Smith hasn’t done that. He has dished out rhetoric.”

Tom Tomorrow once spoke rightly of the need to vote for the lesser of two evils when it is the only practical choice; part of being an adult is choosing among undesirable options often. I will be voting in the Oregon Senate race this year, and I will be voting for Merkley. But, I do believe I speak for the entire state when I say, good Lord I’m sick of this race. We have two candidates acting more like children squabbling over the front seat than aspirants to the second-highest federal office on the ballot. I don’t care who “started it”; grow a backbone and give some dignity to the process. You’re just turning off potential voters.

NYT: Could you talk about how you perceive the U.S. election. Do you see any difference between the two candidates?

…

President Ahmadinejad: … We do not interfere in domestic affairs here in the United States. … But we hope that whoever is elected will start a new path on their exchanges with others. We do believe whoever comes to office has to take care of two issues.

The first is to restrict the scope of America’s interventions abroad to the geography of this country alone. These interventions have caused instability and insecurity around the globe. And place enormous financial pressure on the American people as well as people around the world. … Look at the neglect of these American concerns that have been replaced by an over concern by what goes on abroad and the country’s military budget is increasing every year. Maybe if the American government had not gotten so involved abroad there would have been more peace and security in the world and more welfare for the American people today. … So we believe that whoever becomes president must focus on removing the problems here at home and focus on achieving the welfare of the American people.

The second issue they must give attention to is to fix relations with Iran. That answers your question. We hope whoever is elected brings about real fundamental changes.

NYT: On the question of fixing problems at home instead of working abroad, sometimes in Iran you hear criticism—particularly when I was there after the earthquake in 1990 and in Bam after the earthquake. Iranians always say, “Why are we sending money to Palestine, why are we sending money to Hamas and Hezbollah? We should be rebuilding our houses at home.” So does what applies to the United States also apply to Iran?

President Ahmadinejad: I really want to thank you for caring so much for the Iranian people …. I am an Iranian. I live with the Iranian people. Iranians know best how to fix their problems.

If you didn’t catch that, Ahmadinejad said quite rightly that America would be in a better domestic and international position if we focused on rebuilding at home rather than attempting to fix the world through military power. He said that the United States should not be meddling in the affairs of other countries. The interviewer, not missing a beat, asked him about his support of Hezbollah in Lebanon and Hamas in Palestine, neither of which, you may note, are Iran. Ahmadinejad quickly changed the subject.

The interview is frustrating as a perfect example of how someone can be an enormous hypocrite (as well as a bigot, a crank, and a bully) and still be right. Ahmadinejad’s clock stopped long ago, so it’s frustrating to see it be correct so many times a day. I hope we commit ourselves to not ceding a millimeter of moral high ground to him, even if he is an unpopular leader at home saddled with an economic crisis that he is largely responsible for while heading into an election that is mainly a referendum on the status quo. (We have a lot in common with Iran. After all, by putting down their first popular revolution and re-installing the Shah, we helped create the conditions for the rise of the fundamentalist clerical government that rules today. We go way back… in fact, come to think of it, if it hadn’t been for our foreign meddling, Ahmadinejad wouldn’t be President today, wouldn’t be able to point to America’s bad foreign policy as a way of distracting us from his own failures. Spooky…)

Op-Ed Contributors – Foreign Policy Questions by Foreigners to the Candidates – Op-Ed – NYTimes.com
Many developing countries — mine included — have made sacrifices to carry out tough economic reforms and have sought “trade and not aid.” To succeed, we need to compete on a level playing field with more developed economies. Is the United States ready to shoulder some of the burden by advocating the elimination or tempering of protectionism and subsidies? The United Nations by itself, with its faults and many achievements, does not lead. Nation-states do. American commitment and leadership is a must for effective multilateral cooperation. Will you demonstrate a renewed commitment to multilateralism and the rule of international law? Will you negotiate actively to agree on a post-Kyoto treaty on global warming and seek to join the United Nations Human Rights Council? Lastly, what would you do to regain the trust of your allies who would like to see the United States engaging in respectful dialogue and leading the way in the fight not merely against terrorism — which must be done — but also against world hunger, poverty, inequality and disease?

— MICHELLE BACHELET, the president of Chile

I guess that’s my big problem with protectionism, from both sides of the aisle; in America’s case, it’s massive hypocrisy. There’s a liberal fantasy that poor countries can be self-sufficient if they work hard and get back to the land; they’re doing that. We need to let them play by the same rules we do.

Of course, if you read the article, the entry after it has something else very important to say of American global financial hypocrisy.

So, some American helicopters maybe flew over the Afghanistan-Pakistan border—wherever it is—and got to exchange some friendly bullets with the locals.

Pakistani and American Troops Exchange Fire – NYTimes.com
American and NATO officials said that the two helicopters were flying about one mile inside Afghan airspace to protect an American and Afghan patrol on the ground when the aircraft were fired on by troops at a Pakistani military checkpoint near the Tanai district in Khost Province. The officials said small-caliber arms were used.

In response, the American ground troops shot short bursts of warning fire, which hit well shy of the checkpoint, and the Pakistanis fired back, said Rear Adm. Gregory Smith, a spokesman for the United States Central Command.

“When our forces fired warning shots, we were a little scared of a possible retaliatory fire from the helicopters,” said one of the residents, Hajji Said Rehman Gorbaz. “But we were happy to see the helicopter flying back into Afghanistan. We were happy that our forces fired at the helicopter.”

Pakistan’s president, Asif Ali Zardari, said Thursday that his nation’s military had fired only flares at the helicopters, seeming to draw a distinction with warning “shots,” which usually refers to bullets or other ordnance that could more seriously damage the helicopters.

“They are flares,” Mr. Zardari said as he sat down to meet Secretary of State Condoleezza Rice at the United Nations. He said the flares would alert the pilots that they had crossed the border, which he said is rugged and poorly marked.

Ms. Rice agreed that the border between Pakistan and Afghanistan was “very, very unclear.”

Wow, I wonder how this went. Sounds like the gentlest trading of small-arms fire in the world. Ratta-tatta-tat… so sorry!

Considering both US and Pakistan have the bomb, I hope this conflict doesn’t escalate into missiles with boxes of chocolates strapped to them.

You’ve probably heard about the severe pwnage achieved by counterterrorism expert Diane Shroer and her ACLU legal team. If this ruling stands, and God I hope it does, it’ll be a wonderful day for transsexuals who have now learned that, wow, they can get jobs now. And keep them. You know, our transsexual sons and daughters will get to grow up to be professionals, rather than be limited to prostitution and hairdressing.

GayCityNews – Trans Bias Claim Okayed
“No court would take seriously the notion that ‘converts’ are not covered by the statute,” [US District Judge James Robertson] wrote. “Discrimination ‘because of religion’ easily encompasses discrimination because of a change of religion. But in cases where the plaintiff has changed her sex, and faces discrimination because of the decision to stop presenting as a man and to start appearing as a woman, courts have traditionally carved such persons out of the statute by concluding that ‘transsexuality’ is unprotected… courts have allowed their focus on the label ‘transsexual’ to blind them to the statutory language itself.”

Anyway, this write-up from the AP is a great summary of the logic behind the ruling. A key component of the issue at hand is that the 1964 Civil Rights Act was not crafted with transsexuals in mind. Can you read the statutory language of a ruling to include people not thought of at the time? Well, you can, according to a line of reasoning increasingly used by the Supreme Court, and consistently advocated by one of its more right-wing members.

His name? Antonin Scalia.

PWN’d!

Anyway, I’m really happy to know that a federal court has acknowledged that when you discriminate against transsexuals, it’s sex discrimination. I hope y’alls, my cissexual brothers and sisters, can understand how much that feels like the clouds lifting and the sun coming out. I have a future, and it’s in large part thanks to a wise and forward-thinking ruling out of a US District Court.

September 26, 2008

I just saw the debate at a local pizza place. I think I’ll watch the others at home; I don’t necessarily need to be surrounded by enthusiastic Obama acolyte, speaking as an enthusiastic Obama acolyte. (I already really like him!) But, I should admit that I did participate in some of the cheering and jeering… I don’t want to reflect too much until I’ve had some time to sleep and think about it, but I will say that I liked a lot of the jabs that Obama got in and I can’t shake the impression that McCain’s ship is steadily sinking.

Don’t trust what I say, of course, since I dearly want Obama to win. I was just concerned, given that McCain has a history as a good debater, while Obama’s debate skills have been honed at the knee of the formidable but much different Hillary Clinton, and hasn’t had much other practice. I thought McCain might surprise us, pull a rabbit out of a hat, some kind of fanged Monty Python rabbit that would go right for Obama’s jugular. I was happy that Obama held his ground and got some excellent punches in. I try not to read the pundits in the impressionable post-debate period (the afterglow!), but I can’t help it if my beloved brother scans the reactions around the Internet on his iPhone and reads samples of them aloud. For instance, he says someone at CNN opined that McCain, behind in the polls, needed a big win, making any kind of tie or muddling performance a loss for him, and that sounds quite right. So, whatever you think of Obama’s performance—though I think, on first reflection, that it was stellar—it’s pretty clear that, with the debates as the last chance to change the public’s perception of you before the election, the whole thing cemented the image of Obama as president and McCain as cranky old man. (How many times did he have to gnaw on Obama’s leg over pragmatic diplomacy after he already explained himself? Aaagh…)

Okay, that’s enough! (Though, props to Jim Lehrer, or Lehruh, as he says it, for changing the way debates are done. By squeezing the candidates’ nipples and forcing them to address each other, he began to turn the screws on the way debates are done. We saw plenty of fluff and scripted lines, but we also saw some pleasant cracks of sunlight into the usual dark, sterile debate environment with the new format. If they keep going with this, we may have some real debates in the future rather than the usual trading of stump speeches.) I posted this because, over pizza, root beer, and politics, I drew these sketches on my tablet compy, using GIMP, during the debate. Forgive me if my leanings crept into my caricatures; I only think that Barack Obama is the last chance for America to regain its strength at home and respect abroad.

September 25, 2008

Thank your lucky stars, and your country’s laws or founding documents, if you have freedom of speech. Not having it kind of sucks; just ask Bülent Ersoy, now on trial for criticizing Turkey’s mandatory military service, and its excursions in Iraq to the south.

“I spoke in the name of humanity. Even if I were to face execution, I would say the same thing,” the state-run Anatolia news agency quoted Ersoy as telling the court in Istanbul.

In Turkey, defendants are not expected to enter a plea before a panel of judges hears testimony at a trial and returns a verdict.

Ersoy questioned the fairness of a law making it a crime to criticize Turkey’s mandatory 15-month military service for all men over 20. If found guilty, she could face two years in prison.

Ersoy, 56, who sings traditional Turkish music and dresses in flamboyant gowns, served in the military before her 1981 sex-change operation, her lawyer Muhittin Yuzuak told the court Wednesday.

Turkey wants to join the European Union, to become its first Muslim nation. Turkey will have to clean up this atrocious behavior to join the European club, and EU countries should do all they can to encourage them to do so, and welcome them as a potential member of the European Union.